Marina Contracts – How Did This Happen?
The IOP marina and the marina store have been under the same operator for a number of years and by all accounts both are well run. Until late in 2014 the contracts were 5 year renewable leases.
The contractor asked the city to give him a 30 year lease. His reasoning: he could not get loans for major capital improvements with a lease of only 5 years. This was taken into consideration by city council at its November 18, 2014 meeting. The minutes of that meeting can be found here. Despite opposition to this request from Jimmy Carrol and Sandy Ferencz, the rest of council jumped on board.
Those voting for this 30 year, NO BID lease were the following: Barbara Bergwerf, Marty Bettelli, Ryan Buckhannon, Dick Cronin, Patrick Harrington, Mike Loftus and Jimmy Ward. You will note that 5 of these people are running for election this November.
It has been 3 years since this change was enacted. Has anyone seen any major capital improvements at the marina store or dock? Me neither.
Currently the Marina Store will pay the city a rent of $75,276 and the Marina Operations will pay a rent of $167, 682 this year. (See page 38 of this year’s budget. The budget can be found here.) Are these even reasonable rents for this valuable piece of property? I don’t know the answer to this but it seems to me the city could have engaged the services of a commercial real estate broker to help them in this process. There are a number of excellent ones in this town.
Presumably the city gets a percentage of any profits generated. (I say presumably because I have not seen the contracts.) Who and how determines if a profit is made? Are these businesses audited? After all, “profit” is pretty easy to hide. For example, if there is extra money left over at the end of the year, the company could buy a new vehicle with that money and poof!, the profit is gone.
This is what happens when a council does not do their homework.
If elected to council I can assure you I will never vote for a 30 year NO BID lease.